NEW DELHI: Virtual Network Operators (VNO), or telecom service resellers, are better placed to enable telecom service providers utilize network capacity and share active as well as passive infrastructure in the new $4 billion market opportunity, telecom secretary JS Deepak said.

“Huge amount of network capacity is available. The VNO policy helps in maximizing operators’ efficiency by sharing of spectrum and better capacity utilization,” telecom department’s top official said at an industry event Friday.

A VNO offers telecom services without owning either spectrum or network infrastructure and relies on the network of its partner telecom company to provide services to customers under its own brand name by purchasing bulk voice minutes and bandwidth.

Deepak said that telecom is very active sector, and in the month of September, a new entrant (Jio) launched services and two operators (Reliance Communications and Aircel) merged while a mega spectrum auction is round the corner.

He added that the new industry segment – VNO - brings opportunity in a number of areas that could be strengthened through telecom service operators and VNO partnerships and state-run telco Bharat Sanchar Nigam Ltd. should utilize the opportunity.

BSNL has become the first operator to take up VNO business in a big way. “We are rolling out EoI (expression of interest) for VNE (Virtual Network Enablers) soon. We are planning to give broadband services to consumers through this initiative,” BSNL chairman Anupam Shrivastava said.

The industry estimates suggest that the global VNO market is expected to reach $73.2 billion, with more than 300 million subscribers by 2020, while India is sitting on a $4 billion worth business prospects with 49% rural and 77% untapped mobile Internet market opportunity.

For instance, incumbent telcos are reluctant to move operations further into India’s far-flung regions due to low average revenue per user (ARPU) prospects as compared to urban India.

In March this year, telecom department (DoT) has notified VNO guidelines after almost eight years of discussions with an aim to plug network coverage gaps in India’s rural and remote areas. This holds much significance in the wake of government’s ambitious Digital India plan.

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